chapter 6 importing, exporting, and trade relations · goals identify the economic effects of ......

© 2011 South-Western | Cengage Learning

Importing, Exporting,

and Trade Relations

6-1 Importing Procedures

6-2 Exporting Procedures

6-3 Importance of Trade Relations

6-4 The Nature of Competition

CHAPTER 6

INTERNATIONAL BUSINESS, 4e CHAPTER

© 2011 South-Western | Cengage Learning

Answer the following and turn in

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Page 149 10-14

Page 155 8-12

Page 161 9-12

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© 2011 South-Western | Cengage Learning

According to the report: Who asked

Russia to send troops into Ukraine? Why?

What actions are being considered by the

U.S. regarding this crisis? How has the

crisis affected international markets and

the prices of certain commodities?

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LESSON 6-1

Importing Procedures

GOALS Explain the importance of

importing.

Identify the four steps for importing.

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Importance of Importing

Product demand

Lower costs

Production inputs

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Importing Activities

STEP 1: Determine demand

STEP 2: Contact suppliers

STEP 3: Finalize purchase

STEP 4: Receive goods

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Import Assistance

Customs and Border Protection (CBP)

Food and Drug Administration (FDA)

U.S. Department of Agriculture (USDA)

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LESSON 6-2

Exporting Procedures

GOALS Identify the steps of the exporting

process.

Describe the exporting of services.

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The Exporting Process

STEP 1: Find potential customers

STEP 2: Meet the needs of customers

STEP 3: Agree on sales terms

STEP 4: Deliver products or services

STEP 5: Complete the transaction

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Sales Terms

Free on board (FOB)

Cost, insurance, and freight (CIF)

Cost and freight (C&F)

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Export Documents

Bill of lading

Certificate of origin

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Obstacles to Exporting

No company representatives in foreign countries

Products not appropriate for foreign consumers

Insufficient production facilities to manufacture enough goods for exporting

High costs of doing business in other countries

Difficulty understanding foreign business procedures

Difficulty obtaining payment from foreign customers

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Commonly Exported Services

Hospitality

Hotels, food service

Entertainment

Movies, music, television production,

amusement parks

Financial services

Insurance, real estate

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LESSON 6-3

Importance of Trade Relations

GOALS Identify the economic effects of

foreign trade.

Describe the types of trade

agreements between countries.

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The Economic Effect of

Foreign Trade

Balance of trade

Trade deficit

Trade surplus

Balance of payments

Positive, or favorable

Negative, or unfavorable

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Trade Agreements

Promote economic development

Encourage international business activities

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The World Trade Organization

Deals with rules of trade between nations

Helps producers of goods and services,

exporters, and importers conduct their

business

Encourages international trade

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Regional Cooperation

Economic community

Common market

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Barter Agreements

Direct barter

Countertrade

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Free-Trade Zones

An area designated by a government for

duty-free entry of nonprohibited goods

Commonly located at a point of entry into

a nation

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LESSON 6-4

The Nature of Competition

GOALS List factors that affect international

business competition.

Explain the types of competitive

market situations.

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International Business

Competition

Factors affecting competition

Number of companies

Business costs

Product differences

Benefits and concerns of competition

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Types of Competitive Situations

Pure competition

Monopolistic competition

Oligopoly

Monopoly

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Competitive Market Situations

Monopolistic Competition

● Many sellers

● Slightly different product

Oligopoly

● Few sellers

● Slightly different product

Pure Competition

● Many sellers

● Same product

Monopoly

● One seller

● Usually government

regulated

INTERNATIONAL BUSINESS, 4e CHAPTER

© 2011 South-Western | Cengage Learning

Answer the following

Page 142 – 4-8

Page 149- 10-14

Page 155 8-12

Page 161 9-12

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INTERNATIONAL BUSINESS, 4e CHAPTER

© 2011 South-Western | Cengage Learning

Globalization

There is certainly a positive side to globalization. Those who

support it say that it creates jobs by making companies more

competitive. This results in lower prices for consumers.

Others support globalization because it brings capital and

technologies to impoverished nations and brings international

products back to the United States in return. Globalization

increases the number of decisions that are made on a

worldwide level, resulting in a merging of politics and

decisions that are made for the good of people all over the

world. The cultural intermingling that occurs also promotes

greater equality and acceptance of others, especially since

different people can share the same financial interests.

Speedy travel and worldwide communication has resulted in a

more educated, more cultured public.

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INTERNATIONAL BUSINESS, 4e CHAPTER

© 2011 South-Western | Cengage Learning

Name ID# Date Class period

Teacher Name Writing Prompt

Write about how you might use information

you’ve learned in this class in a real world

situation

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INTERNATIONAL BUSINESS, 4e CHAPTER

© 2011 South-Western | Cengage Learning

You need

Textbook

Whiteboard

Notebook

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© 2011 South-Western | Cengage Learning

If a large retail company raises the

minimum wage it pays its workers, what

impact do you think it might have on the

company, the workers, and the

customers? How might a minimum wage

hike impact a small business, its workers,

and its customers? Do you think the

overall impact on the economy would be

positive or negative? Explain.

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